A number of companies have joined the Japan Exchange Group (JPX) To form a consortium that will develop a proof-of-concept blockchain solution for capital market infrastructure.
Announced yesterday, the JPX revealed that the Tokyo Stock Exchange (TSE), the Osaka Exchange (OSE) and the Japan Securities Clearing Corporation (JSCC) will help form a blockchain consortium compromising of Japanese financial institutions to test the blockchain prototype.
The endeavor to explore blockchain technology for capital market infrastructure began with an internal research group in late 2015, which quickly concluded the viability of the innovation to bring a transformational change to the sector. By February 2016, the Japan Exchange Group announced a partnership with IBM Japan to run blockchain tests for clearing, settlement and other financial operations. The tests began the following month.
The newly-formed consortium will build upon the JPX’s partnership with IBM Japan, with a test environment for blockchain proof-of-concept (PoC) testing using the Linux-foundation-led open source Hyperledger platform.
The consortium will, among other operative objectives, seek to include and bring cooperation between various stakeholders in the development process. Primarily, these are the financial institutions and the engineers developers of the blockchain solutions.
An excerpt from the press release also revealed the need to bring multiple financial institutions across Japan under the single roof of a consortium.
We will seek participation from a wide range of Japanese financial institutions in order to gather broad industrial expertise. Members of the consortium will conduct PoC testing and discuss the applicability of DLT (Distributed ledger technology) to the capital market infrastructure, both from technical and operational perspectives.
Further, the test environment of the consortium will see the deployment of proof-of-concepts and pilots developed by IT vendors, Fintech and blockchain startups as well as financial institutions. “Verifying various applications will help to identify and address technical and services issues,” the JPX added.
Significantly, the consortium will also facilitate information sharing between developers and the banks adopting the technology, while nodding at “efforts such as training on DLT technology by DLT engineers and training on operational workflows by financial institutions.”
PoC testing within the consortium’s environment will begin in Spring 2017.
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